On CEO's first day, Wachovia hits 17-year low

Even with an impressive resume and connections from Wall Street to Washington, Steel lacks experience running a retail bank, Wachovia's main business. He could, however, help steer Wachovia to a merger or outright acquisition.

Steel, former Treasury Undersecretary and Goldman Sachs Group Inc. executive, was hired late Wednesday to lead the Charlotte-based bank, ending a more than monthlong CEO search.

The announcement of his hiring came at the same time the company detailed just how bad its business has been.

Wachovia said Wednesday it had put aside $4.2 billion to cover defaulting loans. It also said its second quarter loss would be between $2.6 billion and $2.8 billion, or $1.23 to $1.33 a share, excluding a goodwill writedown.

The announcement shook investors. The stock closed down $1.16, or 8.1 percent, to $13.13 in New York trading Thursday. Earlier in the session, shares hit $12.65, a 17-year low.

Wachovia shares have fallen by about 75 percent from their 52-week high of $53.10 a year ago.

Credit rating agency Moody's Investors Service put the bank's long-term debt ratings on review for possible downgrade Thursday.

"There's work to be done," Steel told analysts on a conference call.

Steel characterized himself in a separate call with reporters as a "collaborative person" who will draw on the bank's other executives for help. "No one person will have all the answers," he said.